[00:00:03] Speaker 03:
The first case for argument this morning is 18-2015-Deosin, biochemical versus United States.

[00:00:09] Speaker 03:
Mr. Panning, good morning.

[00:00:26] Speaker 00:
Thank you, Chief Judge Prost.

[00:00:27] Speaker 00:
It may please the Court.

[00:00:28] Speaker 00:
Commerce now insists that the main reason it applied adverse facts available is that Dawson failed to produce the export service agreement between AHA and Dawson until after the preliminary determination.

[00:00:42] Speaker 00:
and AHA disclosed the material terms of that relationship well before the preliminary determination.

[00:00:48] Speaker 00:
And based on the information that they had provided, Commerce had already determined that Dawson, not AHA, was the exporter for purposes of Dawson's U.S.

[00:00:58] Speaker 03:
sale.

[00:00:59] Speaker 03:
What do you say based on the information they provided?

[00:01:01] Speaker 03:
Are we talking about the ESA?

[00:01:03] Speaker 00:
We're talking about the responses to the questionnaire, Your Honor, which disclose the material terms of the ESA.

[00:01:09] Speaker 00:
And let me draw your attention to the Joint Appendix at 116.

[00:01:14] Speaker 00:
And this is from the preliminary determination of Commerce in the first administrative review.

[00:01:23] Speaker 00:
And what feature are you directing us to?

[00:01:27] Speaker 00:
116 of the Joint Appendix, Your Honor.

[00:01:31] Speaker 00:
And this is from July 31, 2015, so well before any of these issues came up.

[00:01:42] Speaker 03:
We've got, can I just step in, I'm sorry to take your time.

[00:01:45] Speaker 00:
Not at all.

[00:01:45] Speaker 03:
This is the weird thing about appendices.

[00:01:47] Speaker 03:
I know people try to cramp them in and so they only do the right page, but can, since we've only got a couple pages.

[00:01:53] Speaker 00:
Certainly, Your Honor.

[00:01:54] Speaker 00:
It's following 104.

[00:01:55] Speaker 00:
Can you tell us what this is?

[00:01:56] Speaker 00:
Sure.

[00:01:56] Speaker 00:
It's, it's, this is from the preliminary determination, Your Honor.

[00:02:00] Speaker 00:
Uh-huh.

[00:02:00] Speaker 00:
Um, from July 2015 and, and what the,

[00:02:05] Speaker 00:
What Commerce said at that time is Dawson is the exporter for sales originally attributed to AHA.

[00:02:11] Speaker 00:
Specifically, we preliminarily find that Dawson is responsible for negotiating and setting the terms of sale and directing the activity of AHA with regard to subject merchandise.

[00:02:23] Speaker 00:
That is from July of 2015 before Commerce ever delayed the proceeding to investigate that relationship.

[00:02:31] Speaker 00:
I'd also like to direct the court to page 19 of the government's brief.

[00:02:38] Speaker 03:
What you'll see there is that... So, I'm sorry, is the point you're making with respect to this sentence that the government knew early on and could discern from the responses what the relationship was?

[00:02:50] Speaker 00:
Exactly right.

[00:02:51] Speaker 00:
And then if you look at the government's brief on page 19,

[00:02:56] Speaker 00:
They assert that the actual relationship between Docent and USA is what they say is a far cry from the descriptions that were provided to Commerce in their respective questionnaire responses.

[00:03:13] Speaker 00:
And then they say, indeed, Docent and AHA have since acknowledged that AHA played no role in determining the customer or the terms of sale.

[00:03:22] Speaker 00:
And they cite to the appendix at page 69 to 72

[00:03:27] Speaker 00:
And the appendix page 69 to 72, Your Honor, is... You're going so fast.

[00:03:34] Speaker 04:
I'm sorry.

[00:03:35] Speaker 04:
I have no idea what you just read from in the red brief.

[00:03:38] Speaker 04:
I can't find the word indeed.

[00:03:40] Speaker 00:
Certainly, Your Honor.

[00:03:41] Speaker 00:
I'm sorry.

[00:03:43] Speaker 00:
On page 19 of the red brief, if you look at the first complete paragraph, this is the government's argument that the relationship between AHA and

[00:03:57] Speaker 00:
was not properly disclosed in the preliminary phase of the investigation.

[00:04:04] Speaker 00:
And the government asserts in the middle of that paragraph, indeed, Dawson and AHA have since acknowledged that AHA played no role in determining the customer or the terms of sale.

[00:04:15] Speaker 00:
And you'll see that the government cites there to the appendix at pages 69 to 72.

[00:04:21] Speaker 00:
And that is indeed the response explaining that AHA did not have a role in choosing the customers or terms of sale.

[00:04:31] Speaker 00:
The problem for the government is that response is from October 2014.

[00:04:36] Speaker 00:
This is AHA's initial response.

[00:04:40] Speaker 00:
to the government's questionnaire explaining the nature of the relationship between AHA and Dawson.

[00:04:47] Speaker 00:
It is not some submission from later where there's an acknowledgement of an inconsistency.

[00:04:52] Speaker 00:
AHA and Dawson have been 100% consistent and fully disclosing the nature of this relationship.

[00:04:58] Speaker 03:
Well, what about Appendix 9?

[00:05:01] Speaker 03:
This is the Court of International Trade opinion.

[00:05:04] Speaker 03:
There's a footnote 4 which says, indeed, plaintiffs appear to concede that the ESA agreements were requested by commerce in the original questionnaire, suggesting the withholding of the document was the result of an accidental omission.

[00:05:18] Speaker 03:
Bottom line is that they recognize that the ESA should have appropriately been

[00:05:24] Speaker 03:
included as the response?

[00:05:26] Speaker 00:
No.

[00:05:27] Speaker 03:
You're shaking your head, so I'm assuming you disagree.

[00:05:30] Speaker 00:
Right.

[00:05:30] Speaker 00:
I don't think that that's an accurate characterization of what the representation was.

[00:05:34] Speaker 03:
But I said it what they said in the footnote.

[00:05:36] Speaker 00:
Correct.

[00:05:37] Speaker 00:
But I don't think that the district court's characterization was accurate in terms

[00:05:41] Speaker 00:
I think Dawson always took the position that they understood that question, not to call for the ESA, rather to call for sales agreements that were generated in the train of sale for a sample sale.

[00:05:56] Speaker 00:
That's the wording of the question.

[00:05:58] Speaker 00:
But I really want to emphasize that.

[00:06:00] Speaker 04:
Yeah, but even, who cares what they thought?

[00:06:02] Speaker 04:
If the court made a, you're telling me now what they thought, but if the court made a fact-finding to the contrary, I review that for deference.

[00:06:10] Speaker 04:
I mean, that language of the request, it seems to me they're asking for the ESAs.

[00:06:14] Speaker 04:
You're telling me my client didn't understand that.

[00:06:16] Speaker 04:
But who cares, given the standard of review?

[00:06:18] Speaker 00:
Your Honor, first of all, the review's de novo.

[00:06:20] Speaker 00:
But second of all, the point here is that whether or not the ESA was called for doesn't matter, because there's no material difference between the ESA and the disclosure that was made.

[00:06:35] Speaker 04:
But your earlier argument doesn't

[00:06:37] Speaker 04:
work for me because you say, well, the government knew at an earlier time there was a problem.

[00:06:42] Speaker 04:
But didn't the government then delay the proceedings precisely to investigate the relationship between AHA and DOSIN?

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And what they determined was that what DOSIN and AHA had said all along was exactly correct.

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There was no difference between the relationship.

[00:06:59] Speaker 00:
There was no material difference between the relationship that was disclosed.

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That is, that Dawson and Dawson USA were negotiating the sales price.

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AHA was receiving a commission on sales.

[00:07:12] Speaker 00:
That's exactly what AHA said in the first disclosure, the first questionnaire response.

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It's exactly what Dawson said in its first questionnaire response.

[00:07:23] Speaker 00:
There was no difference.

[00:07:24] Speaker 00:
The statement that there was a material difference

[00:07:27] Speaker 00:
between what was disclosed in the preliminary investigation and what was disclosed by the ESA is not supported by substantial evidence.

[00:07:37] Speaker 00:
Let me point you to another example, Your Honor.

[00:07:40] Speaker 00:
If you look at the government's brief at page 18, the red brief at page 18, the government points out, again, the government is trying to justify the statement

[00:07:55] Speaker 00:
that it only understood the nature of the relationship after the ESA was received.

[00:08:02] Speaker 00:
And the government points out, again, in the middle paragraph, it says that in the administrative review, Dawson had said that it was not privy to the ultimate customers or markets for the subject merchandise sold by resellers.

[00:08:17] Speaker 00:
And the government points out, well, but AHA was considered a reseller, and so that wasn't accurate.

[00:08:24] Speaker 00:
The problem with that argument is that, again, in the very same

[00:08:30] Speaker 00:
response to which the government cites.

[00:08:35] Speaker 00:
If you look, Your Honor, correct, that's what the government cites to.

[00:08:44] Speaker 00:
I have too much paper here, Your Honor, but if the government looks at page...

[00:08:52] Speaker 00:
Yes.

[00:08:57] Speaker 00:
If the government looks at pages 666 and 667 of the Joint Appendix, that is the same questionnaire response.

[00:09:12] Speaker 00:
That's the same submission from March of 2015 by Dawson.

[00:09:16] Speaker 00:
And that's exactly where Dawson says, here's exactly how we arrange sales by Dawson USA.

[00:09:23] Speaker 00:
Here's exactly the role that AHA plays.

[00:09:27] Speaker 00:
Dawson USA is setting the price, or China is setting the price in cases of sales where Dawson USA is not the importer.

[00:09:36] Speaker 00:
And AHA gets a commission.

[00:09:39] Speaker 00:
That's exactly what it says.

[00:09:40] Speaker 04:
What about page 172 of the appendix, where there is a detailed discussion about differences between Tillerson's responses and what later came

[00:09:56] Speaker 04:
to be established through the ESAs.

[00:09:58] Speaker 04:
And the first whole paragraph on 172, which the government cites as how the appellant's withholding of the ESAs impeded the investigation and resulted in inconsistent statements.

[00:10:09] Speaker 04:
This is about whether or not they have knowledge of customer lists or sales calls with resellers.

[00:10:14] Speaker 04:
They said one thing up front, but then they said, oh, well, we consider AHA a reseller, and then they

[00:10:20] Speaker 04:
They do have information about all that stuff, it turns out.

[00:10:22] Speaker 00:
Right.

[00:10:22] Speaker 00:
So that was the example.

[00:10:24] Speaker 00:
The reseller example is the one that is cited in the brief at page 18.

[00:10:28] Speaker 00:
And as I say, in that response to which they cite, they cite to, in the appendix, it's page 674 to 675.

[00:10:37] Speaker 00:
That's the same response to which they were citing in the JA at 172.

[00:10:42] Speaker 00:
And that is the same questionnaire response in which Dawson makes absolutely 100% explicit the role that AHA is playing in the sales that Dawson is making through AHA.

[00:10:56] Speaker 00:
That's at page, again, that's at page 666 and 660.

[00:11:01] Speaker 04:
Clarify again, 172.

[00:11:02] Speaker 04:
What is this document I'm reading?

[00:11:04] Speaker 00:
172 is the post-preliminary determination, Your Honor.

[00:11:11] Speaker 00:
So what happens is that after the preliminary determination, there are comments.

[00:11:16] Speaker 00:
C.P.

[00:11:17] Speaker 00:
Kelko puts in a comment and says there are anomalies and discrepancies in DOCIN and AHA's responses.

[00:11:26] Speaker 00:
And Commerce says, OK, we need to look at that.

[00:11:28] Speaker 00:
We're going to take a little time.

[00:11:30] Speaker 00:
And they delay it in February.

[00:11:34] Speaker 04:
But I'm confused, because you also responded that it's not privy to ultimate customers or markets for the subject merchandise sold by resellers.

[00:11:43] Speaker 04:
Correct.

[00:11:44] Speaker 04:
It doesn't provide customer lists or make joint sales calls with resellers.

[00:11:47] Speaker 04:
But then later they supplemented that they do consider AHA a reseller and they do have knowledge of the customers and sales.

[00:11:55] Speaker 00:
Correct.

[00:11:55] Speaker 04:
But Your Honor, so... So why isn't that justified, the fact finding, that inconsistent statements were made

[00:12:03] Speaker 04:
that weren't clarified until later when the ESAs were provided.

[00:12:07] Speaker 00:
For two reasons.

[00:12:08] Speaker 04:
Why isn't that reasonable for the government to see it that way?

[00:12:11] Speaker 00:
For two reasons.

[00:12:12] Speaker 00:
One is that the response to which they're citing is part of the same questionnaire response in which they described how sales were made through AHA.

[00:12:22] Speaker 00:
So it was clear from context that when they were talking about resellers, they were talking about resellers other than AHA.

[00:12:28] Speaker 00:
That is, customers who might have purchased

[00:12:32] Speaker 00:
the goods in the United States and then resold them.

[00:12:38] Speaker 00:
But the second reason is that in May, six weeks later, May 2015, not in the post-preliminary investigation, in May of 2015, Commerce asks about this and says, where did you provide

[00:13:00] Speaker 00:
where did you provide the, you know, I don't understand how you square your description of AHA with your statement about the reseller.

[00:13:07] Speaker 00:
And so Dawson explained it.

[00:13:10] Speaker 00:
And that's in May 8, 2015, it's JA 1437.

[00:13:14] Speaker 00:
Again, this is well before

[00:13:16] Speaker 00:
the preliminary determination, and then this investigation.

[00:13:20] Speaker 00:
So there is no evidence to support the claim that there was any material information that was lacking or withheld.

[00:13:28] Speaker 00:
It's just not true.

[00:13:30] Speaker 00:
And then the second basis that the government relied on below, and in fact the primary one below, which Commerce seems not really to want to defend, is that there was something tainted about the prices.

[00:13:43] Speaker 00:
Your Honor, I see I'm running very short on time, but what I want to emphasize about the issue with the prices is there was nothing, once it was correctly determined that Docent USA was the seller, the first unaffiliated sale was the sale in the U.S.

[00:14:04] Speaker 00:
from Docent USA to the ultimate customer, not

[00:14:09] Speaker 00:
a sale from AHA to Dawson USA.

[00:14:14] Speaker 00:
Commerce was using the right numbers, and they've never explained why they weren't using the right numbers.

[00:14:19] Speaker 00:
Remember, the purpose of determining the dumping margin is to take the U.S.

[00:14:23] Speaker 00:
sales price and compare it to the normal price.

[00:14:27] Speaker 00:
No one argues, nor could they argue, that the ESA had any impact on the calculation of the normal value.

[00:14:34] Speaker 00:
No one argues, nor could they argue, that the ESA had any impact on the export price or the constructed export price.

[00:14:40] Speaker 00:
Indeed, no one's saying there's anything wrong with the normal value.

[00:14:44] Speaker 00:
And there is no coherent argument, and commerce hasn't offered you one, that the cash deposit rate paid by DOS and USA had any impact on the export price or the constructed export price.

[00:14:58] Speaker 00:
And moreover, Commerce confirmed that Dawson is entitled to a separate rate.

[00:15:03] Speaker 00:
The imposition of 154% dumping margin rather than the 5% that was calculated in the preliminary investigation is punitive and unlawful.

[00:15:13] Speaker 00:
And I'll reserve my remaining seconds.

[00:15:14] Speaker 00:
Thank you.

[00:15:25] Speaker 02:
May I please the court?

[00:15:26] Speaker 02:
I'd like to pick up on one of the points that we were just talking about, whether Dawson considered AHA to be a reseller.

[00:15:34] Speaker 02:
Because I think it's instructive as to how confusing this process had actually gotten by the time Commerce decided to defer its final determination.

[00:15:45] Speaker 02:
So in March 2015, as my opposing counsel said, Dawson says that it's not privy to reseller information.

[00:15:53] Speaker 02:
Then in May 2015, it says it considers AHA to be a reseller.

[00:15:59] Speaker 02:
Then in April 2016, it says there's some confusion.

[00:16:03] Speaker 02:
AHA actually is not a reseller.

[00:16:05] Speaker 02:
AHA is our principal agent.

[00:16:08] Speaker 02:
We are the principal.

[00:16:09] Speaker 02:
AHA is the agent.

[00:16:13] Speaker 03:
copy of the ESA right before that.

[00:16:15] Speaker 03:
Correct.

[00:16:16] Speaker 03:
Correct.

[00:16:17] Speaker 02:
So they go from trying to portray AHA as a mere reseller over which Dawson has no control or no knowledge to at the very end of the proceeding admitting that AHA is actually its agent who has absolutely no control to do anything but to sell Dawson's products at the price at which Dawson arranges prior to sale.

[00:16:40] Speaker 03:
Can you go to the first appendix site that Mr. Panner gave us, which is 116 of the appendix?

[00:16:46] Speaker 03:
This is the preliminary determination he said in 2015, and that second full paragraph talks about their decision to treat DOSIN rather than AHA as a mandatory respondent because they realized something was going on in this relationship.

[00:17:05] Speaker 03:
Yes.

[00:17:06] Speaker 03:
So how does that not indicate that they had some knowledge, not specifically about the ESA, but about the relationship going on?

[00:17:16] Speaker 02:
So Commerce was certainly trying to figure out what was going on.

[00:17:19] Speaker 02:
So it first sends its supplement, its questionnaire to AHA.

[00:17:24] Speaker 02:
And AHA says, actually, no, it's not us.

[00:17:26] Speaker 02:
We don't set the prices.

[00:17:27] Speaker 02:
It's the other party.

[00:17:28] Speaker 02:
So then they send the questionnaire to DoCEN.

[00:17:31] Speaker 02:
DoCEN suggests

[00:17:33] Speaker 02:
but is in a confusing way that it negotiates the prices.

[00:17:38] Speaker 02:
But it negotiates them with AHA.

[00:17:41] Speaker 02:
So then commerce, trying to satisfy its statutory deadlines, issues this preliminary determination, essentially saying, OK, we think what's going on is that DoCEN is the proper respondent here.

[00:17:53] Speaker 02:
And so we're going to use their numbers.

[00:17:55] Speaker 02:
Now, what I think is missing from the timeline that was articulated by my opposing counsel

[00:18:02] Speaker 02:
is that after this happened, and the parties filed their administrative case briefs, the petitioner alerts Commerce to the fact that there is a separate proceeding going on, or has just been completed, a separate proceeding to try to determine what's going on with these two parties' sales.

[00:18:21] Speaker 02:
Because, of course, prior to this administrative review, Docent had exported almost all of its sales, an AHA

[00:18:29] Speaker 02:
it didn't really use AHA as much.

[00:18:31] Speaker 02:
And now, all of a sudden, it's only using AHA.

[00:18:33] Speaker 02:
So Commerce initiates a change or tries to determine whether a change circumstance review is appropriate.

[00:18:39] Speaker 02:
That's a totally separate proceeding.

[00:18:41] Speaker 02:
The petitioner alerts Commerce to the fact that this separate proceeding has gone on and alerts Commerce to the vast inconsistencies between the statements that DoCEN is giving in the change circumstances review proceeding and the answers that it's giving

[00:18:58] Speaker 02:
this proceeding and that's really the the genesis of the confusion so commerce in its prelim that your honor is citing to on page 116 commerce thinks it knows what's going on but then it it figures out it actually doesn't know what's going on because

[00:19:16] Speaker 02:
The answers that Dawson has given in the Change Circumstances Review are vastly different from the answers that it's giving here.

[00:19:22] Speaker 02:
So that's why it takes a step back and takes more time, which is a truly unprecedented thing for commerce to do.

[00:19:30] Speaker 02:
I've actually never seen commerce

[00:19:33] Speaker 02:
do something like defer its final results for this kind of situation.

[00:19:37] Speaker 02:
Obviously, it's the statutory deadline that commerce adheres to religiously.

[00:19:42] Speaker 02:
This is a really unusual thing for commerce to have done because it determined that there was potential fraud in the proceeding.

[00:19:51] Speaker 03:
So you're suggesting the delay was – did they express why they were making the delay, or your suggestion is that the delay was because they were – met with such confusion in the responses, et cetera, that they didn't – couldn't really figure out what was going on?

[00:20:06] Speaker 02:
So the Commerce did express why.

[00:20:11] Speaker 02:
it decided to defer the results.

[00:20:13] Speaker 02:
I think though that the better, the memo is in the record, but I think the better explanation of it is in the final results, where commerce says on page 198 of the joint appendix, while dosing and AHH challenge, this is at the very bottom, the department's legal authority to collect and use factual information after the statutory deadline.

[00:20:40] Speaker 02:
This court has recognized a small number of exceptions when we allow supplementation of an agency record, including where evidence was tainted by fraud and calls into question the integrity of the agency's proceedings.

[00:20:53] Speaker 02:
We have determined that this review is such an exception.

[00:20:58] Speaker 04:
Well, isn't it also correct that in the supplemental questionnaire, Congress requested all documents, contracts, arrangements, and agreements between DOCIN and AHA, and they were just completely not provided in response to that?

[00:21:14] Speaker 04:
It wasn't so much later.

[00:21:15] Speaker 04:
They just kept not giving commerce documentation that was expressly asked for.

[00:21:20] Speaker 04:
that was directly relevant to this point.

[00:21:21] Speaker 02:
Yes, absolutely.

[00:21:22] Speaker 02:
So there are two parts to Commerce's final determination.

[00:21:25] Speaker 04:
I mean, that would make me suspicious, right?

[00:21:26] Speaker 04:
If I keep getting answers from you, but you won't give me the underlying documents that will clearly establish it, its reason seems to me to justify being concerned about the veracity of the statements.

[00:21:37] Speaker 02:
Yes.

[00:21:37] Speaker 02:
So Commerce says there are two parts to its determination, one that Dawson was impeding the review and one that it was withholding evidence.

[00:21:45] Speaker 02:
Now, this is a sort of unusual situation where Commerce didn't actually know

[00:21:49] Speaker 02:
that there was an agreement.

[00:21:50] Speaker 02:
So it didn't know that Dawson was withholding the agreement, because how could it possibly know that there was this kind of agreement?

[00:21:56] Speaker 02:
Until it kept pressing and pressing, and then it realized if this truly is a principal agent arrangement, there probably is some kind of agreement.

[00:22:06] Speaker 02:
And then later on, after the deferral, Commerce starts asking more specific questions.

[00:22:12] Speaker 02:
Is there an agreement between you?

[00:22:14] Speaker 02:
Please give it to us.

[00:22:15] Speaker 02:
But even if the court

[00:22:20] Speaker 02:
didn't think that that was enough.

[00:22:21] Speaker 02:
The original request that Commerce gave is describe your agreement for sales, provide a copy of each type of agreement.

[00:22:31] Speaker 01:
Ms.

[00:22:31] Speaker 01:
Burke, let me ask you a question if I could, please.

[00:22:34] Speaker 01:
As I read the decision below of the Commerce decision and the Court of National Trade decision, Commerce seemed to have two problems.

[00:22:44] Speaker 01:
One, what you've been talking about and what Mr. Panner, the majority of his time, talked about, not furnishing the ESA, the two ESAs.

[00:22:53] Speaker 01:
Then there seemed to be a suggestion in the record that in addition to failure to timely

[00:22:59] Speaker 01:
present the ESAs, commerce had some kind of a problem with the nature of the agreement that was spelled out in the ESAs, okay?

[00:23:08] Speaker 01:
The question I have for you is, supposing the facts were different, and right off the bat, in 2014, 2015,

[00:23:17] Speaker 01:
Dawson had come forward and said, OK, here's the nature of our agreement.

[00:23:21] Speaker 01:
Here's the way it works.

[00:23:22] Speaker 01:
And here are the two ESAs that are in place.

[00:23:26] Speaker 01:
Would we be here today if that had taken place?

[00:23:29] Speaker 01:
What I'm trying to do is separate out concerns about the nature of the agreement from the alleged untimely, improper nondisclosures.

[00:23:40] Speaker 02:
Right, so if Dawson had said from the very get-go, it would have to be from even before Commerce chose its mandatory respondent.

[00:23:47] Speaker 02:
It would have to be at the very beginning of the proceeding.

[00:23:49] Speaker 02:
If Dawson had said, this is our arrangement, AHA actually isn't the proper respondent, it's us.

[00:23:54] Speaker 02:
I think we might have a different case.

[00:23:56] Speaker 02:
However, and I wouldn't want to speculate as to what Commerce would do, but even in that scenario, you have a situation where the parties are clearly not using the correct cash deposit rate.

[00:24:09] Speaker 01:
But didn't you have a situation, we had these two, I thought that early on there was this document that said there are two possible rates here, the docent-docent rate and the docent-AHA, docent-USA rate.

[00:24:23] Speaker 01:
And what if they just come in and said, you know, here we have

[00:24:26] Speaker 01:
these two rates positive.

[00:24:28] Speaker 01:
For business reasons, it makes sense for us to go with the docent AHA, docent USA rate.

[00:24:35] Speaker 01:
Hence, we're going with that.

[00:24:37] Speaker 01:
Here's why.

[00:24:38] Speaker 01:
And here's the document that reflects our procedure.

[00:24:42] Speaker 01:
What would have been wrong if that had taken place right off the bat?

[00:24:45] Speaker 02:
So it is, I think even the appellant would concede that

[00:24:52] Speaker 02:
according to Commerce's own guidance, that is unlawful.

[00:24:57] Speaker 02:
Okay, so that's a separate question of whether they're impeding the proceeding.

[00:25:00] Speaker 02:
That's what I'm saying.

[00:25:02] Speaker 01:
Separating that from impeding the proceeding.

[00:25:05] Speaker 02:
Commerce has said that the proper rate depends upon the identity of the seller.

[00:25:09] Speaker 02:
Where the cash deposit rate is not the cash deposit rate of the seller, the price discriminator, and this is a quote, it is not the proper cash deposit rate required at the time of entry.

[00:25:19] Speaker 02:
So in your hypothetical, Dawson has used the wrong cash deposit rate.

[00:25:24] Speaker 02:
So the question is, isn't that per se

[00:25:28] Speaker 02:
impeding the proceeding by starting out on the wrong place.

[00:25:32] Speaker 01:
They wouldn't be impeding the proceeding, though, because they would be saying, here's what we're doing.

[00:25:36] Speaker 01:
It's like you file for a tax refund, and you lay out all the facts.

[00:25:40] Speaker 01:
You don't hide anything.

[00:25:42] Speaker 01:
The IRS comes back and said, OK, we disagree with you.

[00:25:47] Speaker 01:
They don't go after you for tax evasion.

[00:25:48] Speaker 01:
They go after you and say you owe us more money.

[00:25:51] Speaker 01:
What I'm saying is that would, in my mind at least, not be a situation of impeding.

[00:25:56] Speaker 01:
any investigation.

[00:25:57] Speaker 01:
They would be saying, here's what we're doing, here's why we're doing it, and here are the supporting documents.

[00:26:02] Speaker 01:
How would that be impeding the investigation?

[00:26:04] Speaker 02:
I think hypothetically it could be that it's not impeding the investigation.

[00:26:08] Speaker 02:
And they would have to do it, like I said, they would have to do it before commerce even decides who the mandatory respondent is.

[00:26:14] Speaker 02:
Because, of course, the whole point of this proceeding is for commerce to look at the sales, try to figure out who has the most sales, and choose those parties to

[00:26:24] Speaker 02:
individually review.

[00:26:26] Speaker 02:
So Dawson would have to come in before that process even starts and say, don't look.

[00:26:37] Speaker 02:
analyze any of the information and sent any questionnaires out to anybody to try to figure out who the proper respondent is, Dawson would have to come in way before that and explain what's going on.

[00:26:48] Speaker 02:
And it's true, maybe that wouldn't be impeding the review, but it does sort of highlight the fact that they've structured their sales in a way that's completely contrary to commerce's task here, which is to try to figure out who the price discriminator is, to try to figure out what the real United States price is.

[00:27:11] Speaker 02:
For these reasons, we respectfully request that the court affirm the trial court's judgments.

[00:27:27] Speaker 00:
Thank you, Your Honor.

[00:27:28] Speaker 00:
I think that, Judge Schall, your hypothetical is what happened in this case.

[00:27:33] Speaker 00:
If you look at the joint appendix, if you look at the sites that we have to the joint appendix, the nature of the relationship between DOSIN and AHA was immediately disclosed by AHA and then DOSIN in their responses to the initial questionnaire.

[00:27:50] Speaker 00:
For that reason, Commerce never looked at the wrong prices or the wrong data.

[00:27:54] Speaker 00:
They looked at the correct

[00:27:56] Speaker 00:
sales prices, and they determine the margin.

[00:27:59] Speaker 00:
Your Honor, I did want to get back on one quick question.

[00:28:03] Speaker 00:
You pointed out that the Court of International Trade said that we had acknowledged not providing something.

[00:28:08] Speaker 00:
In fact, there was a mistaken question that was left blank.

[00:28:11] Speaker 00:
That was an oversight, and we said that it had been an oversight to leave that blank.

[00:28:16] Speaker 00:
That was post-preliminary.

[00:28:18] Speaker 00:
As to the production of the ESA, what the government, when they read the question, what they leave out is that the question was

[00:28:26] Speaker 01:
for the sales documentation about with respect to a sample sale and that was the question again it goes to read that question I looked at that question a number of times and it seems to be saying you could fairly read it which is the way I think perhaps commerce and the court did is saying all right give us a sample agreement of your arrangement

[00:28:49] Speaker 01:
and provide us sales data for a particular sample transaction under that agreement.

[00:28:57] Speaker 00:
We certainly aren't resting on the idea that no one could possibly read the question that way.

[00:29:01] Speaker 00:
What I'm trying to get at is that if you look at the ESA, the claim is, and remember, it's Chenery.

[00:29:08] Speaker 00:
You've got to look at what they said.

[00:29:09] Speaker 00:
They are claiming there's a difference, that there's a material difference

[00:29:14] Speaker 00:
between the ESA that's eventually provided and what we told them.

[00:29:18] Speaker 00:
That is not true.

[00:29:20] Speaker 00:
I can't say it strongly enough.

[00:29:22] Speaker 00:
AHA and Dawson revealed the terms of their relationship, exactly the terms.

[00:29:28] Speaker 00:
They said that Dawson sets the prices, AHA takes a 2 percent commission, that's it.

[00:29:34] Speaker 00:
And whether it's sold to Docent USA customers or whether it's sold to an importer other than Docent USA, Docent sets the prices and AHA gets a 2% commission.

[00:29:49] Speaker 01:
That is the... Let me ask you just one question.

[00:29:52] Speaker 01:
So for the moment you had a situation where the transaction is accurately described in all respects, which is what you would say was the case here.

[00:30:02] Speaker 01:
And commerce comes and asks for an agreement.

[00:30:04] Speaker 01:
And the respondent doesn't provide it, intentionally hides it.

[00:30:09] Speaker 01:
And then years down the road, it comes to light.

[00:30:12] Speaker 01:
Would you say commerce could proceed as it did here, even though the agreement perfectly dovetailed with the transaction?

[00:30:21] Speaker 01:
In other words, what I'm trying to get to is if commerce asks for something, isn't it entitled to get it, even if there's no disconnect between

[00:30:32] Speaker 01:
the stated agreement and the document.

[00:30:35] Speaker 00:
So first of all, I would say that Congress could not, in that circumstance, apply it.

[00:30:40] Speaker 01:
Even if there was intentional non-disclosure.

[00:30:43] Speaker 00:
Yes, but let me explain why that's not this case.

[00:30:45] Speaker 01:
Oh, I know that's not this case, but I'm saying assuming there was

[00:30:49] Speaker 01:
The, the deal is accurately described, but there's intentional non disclosure of the contractual document and let me let me.

[00:30:58] Speaker 00:
The reason why not is that 1677 a.

[00:31:03] Speaker 00:
1677E, which provides for facts available, deals with a situation where information is missing from the record.

[00:31:17] Speaker 00:
And so what Congress said, and this is spelled out in the Nippon Steel decision, the 337F3rd decision, what Congress said was, if you don't have information for any of these reasons,

[00:31:31] Speaker 00:
then you can use facts that are otherwise available.

[00:31:34] Speaker 00:
But if you have all the information, and it's found out that there's some information that you asked for that you didn't have, or there's some document that you asked for and you don't have it, but you weren't missing any information, there's no basis for applying facts otherwise available.

[00:31:50] Speaker 00:
And nobody disagrees that you have to have facts available before you get to adverse facts available.

[00:31:57] Speaker 00:
But the reason why that your hypothetical, I think, is useful is that if you're trying to think about, okay, why was the ESA not provided?

[00:32:07] Speaker 00:
Well, one possibility is they didn't think it was called for.

[00:32:09] Speaker 00:
Another possibility is they were trying to hide something.

[00:32:12] Speaker 00:
Okay, well if they were trying to hide something, then when it was produced, one would discover what was hidden.

[00:32:18] Speaker 00:
And there was nothing hidden.

[00:32:20] Speaker 04:
Again, the... Well, the commerce views this as, even if I accept that you're correct, that they were forthright ultimately with commerce, they weren't forthright with customs because they paid the lower rate.

[00:32:33] Speaker 04:
So they weren't forthright from the beginning.

[00:32:35] Speaker 00:
That was not a question of being not forthright.

[00:32:39] Speaker 00:
They had advice of counsel that said that in a circumstance where Dawson is the producer and AHA is the exporter, that they should pay the lower rate.

[00:32:47] Speaker 00:
In any event, it's not material.

[00:32:49] Speaker 00:
That's an issue for customs.

[00:32:52] Speaker 00:
Customs finds out about it, and indeed during the preliminary phase, commerce knew

[00:32:57] Speaker 00:
that this had been referred to Customs.

[00:32:59] Speaker 00:
They were already aware that Customs was looking into this issue, and indeed Customs did ultimately tell Dawson, you should stop using the Dawson AHA case, you should use the Dawson Dawson case.

[00:33:11] Speaker 00:
This is just a deposit anyway.

[00:33:14] Speaker 00:
Okay?

[00:33:14] Speaker 00:
This is not the dumping duty.

[00:33:17] Speaker 00:
This is the deposit.

[00:33:19] Speaker 00:
And ultimately, commerce needs to determine the dumping margin so that the proper dumping margin is imposed.

[00:33:26] Speaker 00:
In the preliminary phase, they determined that was 5%.

[00:33:30] Speaker 00:
In the third phase, after this was over, they determined it was 9%.

[00:33:34] Speaker 00:
They imposed 154% dumping margin because for reasons that they give in the order that you can read, and they aren't defending those.

[00:33:44] Speaker 00:
They said that we were misleading.

[00:33:46] Speaker 00:
We weren't.

[00:33:46] Speaker 00:
They don't claim we were.

[00:33:47] Speaker 00:
They say that this tainted the prices.

[00:33:51] Speaker 00:
They didn't.

[00:33:52] Speaker 00:
They don't claim they did.

[00:33:53] Speaker 00:
Or if they do, it's completely incoherent.

[00:33:56] Speaker 00:
We provided absolutely 100% correct, accurate information in the preliminary phase of this investigation.

[00:34:04] Speaker 00:
And Commerce even drew the correct conclusion, which they reaffirmed later, which was that these were dosing USA sales.

[00:34:18] Speaker 00:
I'm grateful for the extra time.

[00:34:21] Speaker 00:
Thank you, Your Honor.